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PREVIEW-BOJ's tankan seen showing business mood slightly down on strong yen

* March tankan big manuf mood seen at +25 vs +26 in Dec

* Big non-manuf mood f'cast at +24 vs +25 in Dec

* Outlook sentiment seen slipping

* BOJ Tankan due at 2350 GMT on April 1

TOKYO, March 23 (Reuters) - Japanese business confidence was expected to deteriorate slightly in the three months to March with the outlook for the coming quarter also fading, a Reuters poll found on Friday, reflecting concerns over the strong yen eroding business profits.

The Bank of Japan's (BOJ) quarterly tankan business sentiment survey is expected to show the headline index for big manufacturers' confidence declining by one point to plus 25 in March, the poll of 20 economists showed.

The BOJ has revised the list of companies it surveys, while big manufacturers' business mood in December was revised up to plus 26 from 25.

The poll showed the index of big non-manufacturers' sentiment was also down at plus 24 from a revised plus 25 in the December survey.

"We expect both big manufactures and non-manufacturers have become cautious due to factors such as a firmer yen, falls in share prices and unstable weather," Hideaki Kikuchi, senior economist at Japan Research Institute, said in the survey.

"The business mood among medium- to small-sized companies likely dipped as labor costs and rises in crude oil prices trimmed their profits."

Both big manufacturers and non-manufacturers forecast business conditions would worsen to plus 22 and to plus 21 respectively in the next three months, the poll found.

"There appears to be a temporary pause in the improvement of business confidence due to the yen's recent strength and higher raw material costs. But the data will likely show moderate and sustained economic expansion," said Akiyoshi Takumori, chief economist at Sumitomo Mitsui Asset Management.

Big corporations are seen raising capital spending for the fiscal year starting April by 0.6 percent, the poll found.

Analysts say big firms will revise up their capital expenditure spending plans later thanks to brisk global demand for Japanese goods such as semiconductor products.

The Bank of Japan will publish its tankan survey results at 8:50 a.m. on Monday April 2 (2350 GMT on April 1).

Separately, the Reuters Tankan, which closely tracks the BOJ's tankan survey, showed that confidence among Japanese manufacturers edged up in March from three months ago and the service sector's mood hit a three-year high.

The poll also found industrial production rose 5.0 percent in February from the previous month following a revised a 6.8 percent decline in January.

"There are concerns over impacts from the strong yen, trade protectionism measures by the United States and production falls in smartphones, but global economic growth will continue to support," said Takumi Tsunoda, senior economist at Shinkin Central Research Institute in the survey.

The trade ministry will announce factory output data at 8:50 a.m. on Friday March 30 (2350 GMT on March 29).

The poll showed the Tokyo area's core consumer price index, which includes oil products but excludes fresh food prices, was expected to rise 0.9 percent in March from a year ago, the same as rising rate seen in February.

The jobless rate is seen higher at 2.6 percent in February and the jobs-to-applicants ratio likely improved to 1.60, which would be its highest since January 1974.

The internal affairs ministry will release the core CPI for Tokyo and jobs data at 8:30 a.m. on Friday.

(Reporting by Kaori Kaneko Editing by Eric Meijer)